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Friday, January 22, 2016

Little Hope with Ten Days Left in Safe Harbor Talks

The EU’s data protection authorities have set January 31 as the deadline for achieving a successful conclusion to the US-EU negotiations over a strengthened Safe Harbor framework.With only ten days to go, here are the latest reported developments:

On January 21, Reuters reported that the DPAs are “leaning towards the restriction of personal data transfers to the US because of the risk of U.S. surveillance,” with their February 2 meeting to decide the extent of the restrictions. During a preparatory meeting held on January 20, a consensus may be forming around prohibiting any new data transfers relying upon model contracts or BCRs.

Should this prove to be the position of the Article 29 Working Party, it would be a bitter pill for companies that decided to put off securing an alternative legal basis for data transfers until the outcome of the Safe Harbor talks was known. Had they acted promptly after the October 6 Schrems ruling, and developed contractual solutions, for example, they would not face a business-crushing cut-off in data transfers should a bar against new authorizations be announced. According to a survey of over 300 businesses carried out in December by TRUSTe, 78% of companies are continuing with Safe Harbor and awaiting a new Safe Harbor 2.0. The fact that the US Dept. of Commerce has kept Safe Harbor open for business, and not advised participants to seek the alternative mechanisms recommended by the DPAs, would be a major contributing factor to such a debacle.

Also on January 21, The Hill reported that the Judicial Redress Act, having passed the House, is stalled in the Senate. Many observers believe that enactment of the bill would be more symbolic than substantive, since extending the same protections against government surveillance enjoyed by Americans to Europeans would only create equity in the lack of effective protection enjoyed by anyone. In addition, both former DOC official Cameron Kerr and the US Chamber of Commerce agree that passage of the Act would not have a direct impact upon the negotiations (a point confirmed by one of the EU's negotiators, Andre Glorioso, a few days later). At the same time, its passage might at least have bought some good will in Europe and more time for talks to continue.

On January 22, Forbes reported that according to European Commission spokesperson Christian Wigand, intense negotiations are occurring and are ongoing. Although US Commerce Secretary Penny Pritzker was said to have recently presented at least two packages stating the US position to the Commission, details of these packages have been withheld. According to Forbes, the assurances against inappropriate surveillance contained in Pritzker’s proposals “fall far short of what EU law requires.” As an indication of the immensity of the gap separating the two sides, Paul Nemitz, director for fundamental rights at the Commission’s Justice directorate and one of the negotiators in the Safe Harbor talks, said that it would be “a misunderstanding to say we’re only talking about national security right now.”